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South Korean Kospi Hits Record High of 3,600 Amid Semiconductor Surge
South Korea's Kospi index reached an unprecedented milestone by surpassing the 3,600-point mark for the first time, driven by a rally in semiconductor stocks fueled by robust foreign investor activity. Despite lingering concerns about a potential U.S. government shutdown, the positive momentum in the semiconductor sector provided enough optimism for the stock market to post strong gains.
On October 10, the Korea Exchange reported that the Kospi closed at 3,610.60, up 61.39 points or 1.73% compared to the previous trading session of 3,549.21. The index opened strong at 3,598.11, gaining 48.90 points or 1.38%, before briefly breaching the 3,600-point level during intraday trading.
Foreign Investors Drive Semiconductor Investments Beyond $400 Billion
Foreign investors played a pivotal role in the Kospi's rally, with net purchases totaling 834.9 billion won. In contrast, individual and institutional investors net-sold 299.5 billion won and 74.8 billion won, respectively.
Jae-Won Lee, a researcher at Shinhan Securities, noted, “Foreign investors have maintained net buying pressure over the past five sessions, exceeding an impressive 400 billion won, particularly targeting semiconductor stocks amid bullish holiday news. Despite concerns surrounding a prolonged U.S. government shutdown, semiconductor optimism helped lift Samsung Electronics and SK Hynix significantly, pushing the Kospi beyond 3,600.”
Samsung Electronics and SK Hynix Achieve Historic Highs
Samsung Electronics and SK Hynix spearheaded the semiconductor rally as both stocks reached record-breaking performances. Samsung Electronics climbed 6.07% to close at 94,400 won—a four-year-and-nine-month high—while SK Hynix surged 8.22% to settle at 428,000 won, marking new 52-week highs.
Other notable movers included Doosan Enerbility, which soared 14.97%, further contributing to the market’s strength. However, gains were not universal. LG Energy Solution declined by 9.90%, and Hanwha Aerospace retreated 5.01%, tempering the overall market advance.
AI Developments Propel Semiconductor Supercycle Expectations
The continuing advancements in artificial intelligence (AI) have been a major catalyst underpinning the optimism surrounding semiconductor stocks. Analysts maintain expectations for an imminent semiconductor supercycle, which is defined by soaring demand and prolonged growth driven by cutting-edge technologies.
Samsung Electronics' market capitalization surged past 550 trillion won, while SK Hynix surpassed 300 trillion won, solidifying their dominance in the global semiconductor sector. “The AI-driven momentum is playing a crucial role in supporting the sustained strength of semiconductor stocks,” Lee added.
Kosdaq Index Ends Higher with Mixed Results
South Korea's junior Kosdaq index mirrored the Kospi’s gains, closing at 859.49, up 5.24 points or 0.61% from the prior session’s 854.25. The index opened at 858.86, increasing 4.61 points or 0.54%, but moderated throughout the trading session.
Foreign investors net-bought 210.6 billion won on the Kosdaq, while individual and institutional investors net-sold 130.4 billion won and 79.3 billion won, respectively. Stock performances varied across the board. Rainbow Robotics gained 7.15%, while other leading stocks experienced losses, including EcoPro BM (-3.44%), Samchundang Pharm (-3.02%), Alteogen (-2.23%), EcoPro (-1.69%), and ABL Bio (-1.57%).
Korean Won Declines as Volatility Persists
In currency trading, the Korean won weakened against the U.S. dollar as heightened volatility weighed on the market. The won-dollar exchange rate closed sharply higher at 1,421.0 won, up 21.0 won from the previous trading session’s 1,400.0 won. The depreciation of the won reflects ongoing uncertainty amid global economic and geopolitical pressures.
South Korea’s stock market performance underscores the growing influence of the semiconductor industry as a cornerstone of the nation’s economy. With expectations for a semiconductor supercycle bolstered by AI advancements, foreign investor confidence remains strong, further solidifying the country’s global leadership in tech innovation. Despite broader market fluctuations and currency volatility, the Kospi’s landmark achievement demonstrates resilience and growth potential in an evolving economic landscape.
